Why Lidl is changing forever…

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Germany
# schwarz group
# lidl

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Overview

This video is about the transformation of the Schwarz Group, the German retail giant behind Lidl and Kaufland, into a technology company. Under the leadership of Gerd Chrzanowski, the company is expanding into areas such as cybersecurity, cloud computing and artificial intelligence. Lidl is leveraging its size and internal know-how to first develop these technologies for itself and then sell them to other companies. The company has made major investments in these areas, including the acquisition of Israeli cybersecurity company XM Cyber and a significant stake in German AI startup Aleph Alpha. The video highlights the challenges and opportunities arising from this strategic reorientation and questions whether the Schwarz Group can become a true technology group.

From discounter to tech giant
- 🛒
  The Schwarz Group, known for Lidl and Kaufland, is expanding beyond retail and developing into a technology company.
- 💻
  Under the leadership of new CEO Gerd Chrzanowski, the company is investing in cybersecurity, cloud computing and artificial intelligence.
- 🚀
  The Schwarz Group uses its size and internal know-how to first develop these technologies for itself and then sell them to other companies.
The digitalization of trade
- 📱
  Lidl Plus, the loyalty program via app, was launched in 2020 and is a great success.
- 📊
  The app collects data on customers’ purchasing behavior and enables Lidl to display personalized advertising.
- 🔌
  Lidl integrates additional services into the app, such as booking electric car charging stations.
- 💻
  The Schwarz Group invests in omnichannel strategies to connect stationary business with online commerce.
Cybersecurity and Cloud Computing
- 🔒
  The Schwarz Group has invested heavily in cybersecurity in recent years after realizing it was vulnerable to attacks.
- 🇮🇱
  In 2021, the company acquired Israeli cybersecurity company XM Cyber for 700 million euros.
- 🖥️
  The Schwarz Group now operates its own data centers and offers cloud services for itself and other companies.
- 🇩🇪
  The company advertises its German data centers and data protection standards as a selling point for its cloud services.
Artificial Intelligence and the Future
- 🧠
  The Schwarz Group invests in artificial intelligence and takes a stake in the German AI startup Aleph Alpha.
- 💰
  The company is supporting the construction of an AI campus in Heilbronn, which will become a center for research and development.
- ❓
  It remains to be seen whether the investments in AI will pay off for the Schwarz Group and whether Aleph Alpha can keep up with the competition.
Conclusion
- 🤔
  The Schwarz Group is undergoing a transformation process and is trying to establish itself as a technology company.
- 🏆
  The company has already made great progress but faces challenges from strong competition.
- ❓
  Only time will tell whether the Schwarz Group can achieve its ambitious goals.

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Key moments

Intro
The Schwarz Group, known for Lidl, is expanding into the tech sector.
The Lidl story
Background of the Schwarz Group and its rise in the food retail industry.
Dieter Schwarz, the publicity-shy mind behind the success.
Lidl's beginnings and the adaptation of the Aldi brothers' discounter model.
The Schwarz Group overtakes Aldi and becomes the largest retail company in Germany.
Comparison of the Schwarz Group's sales with DAX companies.
Number of employees and the difference to listed companies.
The secrecy of the Schwarz Group and their dealings with the press.
Klaus Gehrig’s leadership style and initial reluctance to embrace digitalization.
Power struggle over the company’s digital future.
Gerd Chrzanowski takes over the leadership and initiates the transformation.
The complex corporate structure of the Schwarz Group.
The four business areas: Lidl, Kaufland, food production and disposal.
The role of the Schwarz Foundation and its financing of charitable projects.
Gerd Chrzanowski cleans up
The challenges for Chrzanowski: stagnating growth in retail and the need for digitalization.
Dieter Schwarz' focus on expansion and the founding of Schwarz Digits.
The vision of Schwarz Digits: The Schwarz Group as a tech giant.
The digitalization of trade
The introduction of Lidl Plus as the first step towards digitalization.
The goal of Lidl Plus: customer loyalty and collection of data on purchasing behavior.
The success of Lidl Plus compared to other retailers.
Personalized advertising and integration of new features such as electric car charging stations.
The importance of integrating online and offline commerce (omnichannel).
Customers’ expectations of a seamless digital purchasing process.
Cybersecurity
The importance of cybersecurity in the digital age.
The vulnerability of companies to cyber attacks.
Lidl as part of the critical infrastructure and the need for investments in cybersecurity.
The acquisition of the Israeli cybersecurity company XM Cyber.
Building a powerful cybersecurity infrastructure.
The secrecy of the Schwarz Group’s cyber center.
Selling cybersecurity solutions to other companies.
Well-known customers such as SAP and Commerzbank.
Cloud
The importance of the cloud in the digital age.
The dominance of American and Chinese hyperscalers in the cloud market.
The problem of data protection when using cloud services from American providers.
The Schwarz Group’s decision to become a cloud provider itself.
The construction of our own data centers in Germany and Austria.
Offering cloud services with a focus on data protection to other companies.
The comparison with the business model of Amazon Web Services.
The growth of Schwarz’s digital business and the high margins in the cloud business.
Competition in the cloud market and the question of whether the data protection argument can prevail.
Artificial intelligence
Investing in artificial intelligence is the logical next step.
The hype about ChatGPT and the search for a German opponent.
The investment in Aleph Alpha, a German start-up for AI language models.
Financing Aleph Alpha with Lidl billions.
The construction of the AI campus IPAI in Heilbronn with the support of the Schwarz Foundation.
The close integration of non-profit and private sector research in the IPAI.
The financing of the IPAI by the Schwarz Group.
The combination of cloud, cybersecurity and AI as a vision of the future.
Competition in the AI market and the question of monetization.
The challenges for Aleph Alpha and the criticism of the investments.
Conclusion
The transformation of the Schwarz Group from a retailer to a digital player.
The benefits of internal use and further development of digital technologies.
The need for new business areas for further growth.
The vision of Lidl as the German Amazon.